KARACHI: The Federal Board of Revenue (FBR) has stopped sales tax registration as manufacturers after it was found that certain elements not qualifying as manufacturers had got them registered as one to avail certain benefits.
As of December 31, 2015 online registrations were approved for manufacturers or for any other category within 24 hours of submission of online request. This had resulted in granting registration to some persons who were registered as manufacturers but subsequently it was discovered that they were not eligible for granting registration as manufacturer.
The subsequent discovery of few unscrupulous persons has been made a pretext by FBR for putting on hold all the request for registration as manufacturers, which is causing huge problems for a number of tax payers since last over 45 days.
“This is a very serious and disturbing matter. A number of genuine manufacturers are suffering the most as a result of unattended registration requests submitted by them soon after December 31, 2015 that are all held in abeyance and pending even after lapse of over 45 days which is hampering their import and manufacturing business,” Mohammad Zubair President Karachi Tax Bar Association (KTBA) said in a letter to Chairman FBR.
There are instances where online system inquiry shows in the portal that the request has been approved but it is otherwise held up. Some instances are where registration of manufacturers were cleared wrongly as service provider during this period.
“The taxpayers are unable get any relief from the General Manager PRAL and other relevant officers as the FBR has halted the grant of sales tax registration for manufacturing category and the criteria in this regard has not been issued by the FBR,” Zubair added.
KTBA has approached FBR for immediate action to address the difficulties of existing taxpayers and delay in resolving these issues are becoming counterproductive to its drive to widen tax net.